Property Investment – what would you buy?

by Mark Alexander

5 years ago

Property Investment – what would you buy?

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Property Investment – what would you buy?

Whenever I walk down a high street I can’t help looking through the window of the local estate agents and letting agents.

I stand there working out rental yields and often I get tempted to buy.

Do you ever do that?

Property Investment - what would you buy to let?The only reason I stopped buying a few years ago is that I had already achieved all of my financial goals having been in the property investment business for over 20 years. For me it was time to stop investing and to start living.

My current lifestyle is only possible as a result of many years of building my property portfolio.

Over the years I have created systems for everything I do in terms of property investment and property/tenant management and it’s those systems which now afford me the luxuries in life of freedom and opportunity to do what I enjoy best. It’s not all about travelling, spending time with family and sitting on beaches though. I love to engage with other landlords, hence my commitment to sharing best practice on this property forum which, as you may be aware, is funded entirely by donations and sponsorships.

Some of the most common questions I get asked are; how did you do it, is it still possible, what would you do if you were starting again today? Well if you read all 6,000+ posts on Property118 you will get a good idea, however, I’ve been thinking to myself that there must be an easier way to share what I know and to make it relevant to what’s happening in the buy to let property investment business today.

The idea I came up with is to ask you (Property118 readers) where you would consider buying. I will then investigate that area, select a property that I would buy myself (if I was still investing) and explain why. More to the point, I will also document how I would finance, let, manage and maintain the property along with the “desk top due diligence” I would ordinarily do prior to committing to viewing a property with a view to making purchase.

Would you find that useful?

If so, please leave a comment in the section below and let me know which areas you would like me to investigate.

Now I won’t necessarily pick the same properties that you would. That’s because we are all different and we all have a variety of motives for investing into property. Therefore, please don’t ask me to look into high yielding properties such as HMO’s, student properties or housing for state supported tenants as that’s not what I know about. I don’t know much about very high value properties either, my market is far more akin to properties which will appeal to Mr and Mrs Average, either with children of school age or retired. What you might find useful, even if we do do pick different properties, is the way I go about making my decisions.

I will assume that in every case I have access to up to £100,000 cash to invest. Based upon my findings I will explain how many properties I would buy using that money, how much finance I raise in terms of mortgages and how much capital I would retain for a rainy day.

The types of properties I will be selecting will be as follows:-

  1. Decent low maintenance properties in decent areas to attract decent low maintenance tenants
  2. NET cashflow return based on NET capital invested will be greater than could be achieved from a bank or building society
  3. Easy to re-sell or re-let in all market conditions
  4. Prospects for capital growth over the medium to log term, i.e. seven to 20 years

So back to my question, what areas (towns and or cities) would you like me to look into and why?Property Investment - what would you buy

Comments

Leon Watson

5 years ago

Hi Mark,

Great post. I'd really like to know what you would buy in South East London, i.e. Lewisham, Brockley, Catford, Bromley etc.

Look forward to hearing from you.

Leon.

Vanessa Warwick

5 years ago

Hi Mark,

This should turn into a useful blog. 🙂

I find a very simple way to determine which properties to buy.

I find the demand BEFORE I think about creating the supply.

In other words, the market will dictate to you where to buy and the type of property that is in high demand.

i have explained how to find demand on my post

Getting started in BTL in 10 easy steps

http://www.propertytribes.com/how-get-started-btl-10-easy-steps-t-8255.html

I believe that the main growth area in BTL is in holiday lets on the South Coast. If I was in buying mode, I would be buying more of those.

Kanji Hirani

5 years ago

Hi Mark

Excellent post. I would really like to know what you would buy in North West London, i.e. Harrow, Kingsbury, Willesden, Neasden etc.

Look forward to your thoughts in this area

Kanji

Sarah Bentall

5 years ago

Hi Mark, we are thinking of buying in Hastings. Is it an up and coming area or has it already up and come?

Vanessa Warwick

5 years ago

Hi Sarah,

I am a big fan of holiday lets on the East Sussex coast. I have a high yielding holiday let at Camber Sands, a few miles down the coast from Hastings.

Hastings needs to up and come though. It has several areas that are very down and out and it also has a number of social problems, as a significant number of people there are on housing benefit and there are problems of drug abuse and anti-social behaviour.

If you are thinking of traditional BTL, then you need to find areas that have private tenants.

Or consider holiday lets where properties have sea views.

I think Hastings has a lot of potential, but it may be slow in coming because of the economic down turn.

Intense due diligence will ensure you make a safe choice of property in the area.

Hope that helps?

Jerry Jones

5 years ago

Bristol is regarded as a prosperous city, rather like a small London. I'd be interested in your views about that, in the context of knowing about the areas of the city you look at from the local's viewpoint - could have some good discussions about your choices.

Joe Bloggs

5 years ago

jaywick, essex. i recently bought there. its meant to be one of the most deprived areas of the south east (secret millionaire did an episode), and has a bad, but undeserved reputation. the locals are really friendly, fantastic beach, incredibly low prices and relatively high rents. grants available and landlord licensing on the cards (which is necessary). can only go one way.

Chris Mayger

5 years ago

Hello again Mark. Judging by the number of replies your invitation has generated, it doesn't look like you are going to be having any more time off for a while!!

The area of interest for me is the market town of Faversham in Kent, where my wife and I live. It is just 4 miles West of the seaside town of Whitstable, which is very popular with Londoners on their day trips/holiday homes, and property prices there reflect this..

Faversham, is an area which is reckoned to be next on the list to see real capital growth as Whitstable becomes more saturated. Typical investment property types in Faversham are 2/3 bed Victorian terraced stock £!35k - £155k, but bargins have proved very difficult to find, and although we have a good portfolio of properties, we have not managed to break into the local market (high prices and low yields, but good demand).

So good luck with this one Mark, and if I any help you with this in anyway, please just let me know.

Kind regards
Chris and Sue Mayger

Mark Alexander

5 years ago

Thanks for all the responses so far and please keep them coming as it's very useful as an indication as to where to start. Also see my latest linked article below 🙂
.

Graham Clark

5 years ago

Mark,

The exact area is not greatly important for me. However, I would love to see your thought process in the financing, letting options, due diligence etc etc in a "story-like" format.

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